New research from Hitachi Capital Business Finance reveals more than two in five small businesses in Transport and Distribution (44%) are optimistic about the prospect of growth over the next three months – with only 13% predicting contraction.
As part of its five-year tracking study of small business hopes and fears, Hitachi Capital Business Finance asked 1,177 small business owners to give their outlook on the months ahead, specifically whether they predicted growth or contraction.
Overall, the small business community’s youngest entrepreneurs (those aged under 35) are the driving force behind the sector’s optimism this spring. With just weeks until Brexit comes into force, more than half the UK’s young generation of small business leaders (53%) say they feel optimistic about growth in the months ahead.
Heads held high
Interestingly, despite reports of a slump in the sector, those in manufacturing were the most likely to be predicting a boom in growth this quarter – with almost half of respondents (46%) optimistic about the months ahead. Also weathering the political and economic storms were enterprises operating in IT & Telecoms – which saw a quarter-on-quarter rise in business optimism for small enterprises in the sector (42%, Q1 2019 vs. 31%, Q4 2018).
Proving that the North really is a powerhouse, small businesses based in both the North East (48%) and the North West (44%) were thriving under the unpredictable UK economic climate, and were the most likely to be forecasting that their companies would grow in the next three months.
Q1 2019 sector outlook on growth
|% predicting growth||% predicting contraction|
|Transport & Distribution||44%||13%|
|IT & Telecoms||42%||17%|
|Finance & Accounting||40%||13%|
|Hospitality and Leisure||25%||15%|
Down on their luck
Hitachi Capital’s new research further illustrates the challenging period that the retail sector has been going through, rippling down to affect smaller companies. The findings show that small businesses within the sector are those most likely of the 13 surveyed to be battling with the prospect of closure. One in four respondents from the retail sector (25%) predicted their business would contract in the next three months.
In Wales, small business growth predictions were bleaker. More than two in four Welsh small businesses (27%) said they would struggle over the course of the next three months – more than double the figure this time last year (13%). Contraction levels have also risen for those small businesses based in Scotland. This quarter, 24% of Scottish respondents said that their business would struggle, rising sharply from just 3% at the end of last year.